Age of the Customer | The Age of the Customer – by Jim Blasingame

Small business success through life-long learning

June 19, 2014 10:00 am , admin

“You can’t teach an old dog new tricks.” It’s a popular phrase, but in the Age of the Customer small businesses are learning the hard way that their old dogs need to learn some new tricks — and quickly.

In the second century B.C., the Roman statesman, Cato, began learning Greek at the age of 75. When asked why he was undertaking such a challenging educational enterprise at his advanced age, he replied, “This is the youngest age I have.”

No matter what we do, no matter where we go, owner or employee, we must continue to study, train and learn. Everyone in your organization. Everyone, every day, needs life-long learning. And in the age of globalism and interconnectivity, it is more important than ever before.

Are you feeling threatened, maybe even frightened these days with all of the economic challenges, plus the changes brought on by the advent of the information age? Me, too. Sometimes it seems we’re like Alice – running as hard as we can just to stay in one place. And in our Wonderland, everything is changing so fast that what we learned today may be obsolete tomorrow.

The irony is the thing creating so much potential for anxiety is also the thing that can help you stay competitive. That thing is called technology. Specifically, the unprecedented wealth of information available on the Internet.

When I feel threatened by all of the new knowledge and capability that’s emerging, I just make a point to learn something new every day, with emphasis on social media and e-commerce, or how my industry is adapting to the virtual marketplace. When I acquire that new understanding or capability, I smile like Alice’s Cheshire Cat because learning makes me feel stronger, as if I’ve gained a little ground in the marketplace. Maybe today I put the heat on a competitor.

Advantage: Me.

Give it a try. The only thing better than your garden variety smile is one that comes from knowing you just got a little smarter.

Remember the wisdom of the statesman: This is the youngest age you have.

It’s your moment of relevance. Take advantage of it.

Posted in: Age of the Customer, Future Thinking, Moment of Relevance , Tagged: age of the customer, business plan, Jim Blasingame, moment of relevance, small business, small business advice, small business learning, small business planning, small business success, small business transition

Don’t be stupid — eliminate barriers of customers to your small business

June 18, 2014 10:00 am , admin

A while back, I needed to reach an acquaintance who worked in a local branch of one of the national banks. When I looked for the local number in the phone book, all I found was a toll-free number that connected me to a computer answering system. That’s right – a local business didn’t publish a local number in the phone book, and here’s the stupid part: The answering system didn’t offer an option to connect to any branch or person.

From this one encounter stemmed a powerful story and four equally powerful lessons I thought worth sharing to big and small businesses out there.

Lesson 1 – Don’t create barriers to customers and prospects.

If you have any, take them down NOW! I know you think you don’t, but in the name of efficiency and the advent of new technology, you might.

Undaunted, I called a local board member of that bank who gave me the local number (yes, they had one). When I called, I was told that my acquaintance, a loan officer, had recently been laid off.

“Why was he laid off?” I asked. Since the bank was losing money and, for the sake of the stock price the CEO needed to impress the stock analysts with his guidance on the next quarterly conference call. So an edict came down that almost 2,000 employees across the company would have to hit the bricks. Never mind how valuable they were, or what such cuts would ultimately do to the bank’s long-term ability to compete, “We’ve got to cut costs and the quickest way is to cut payroll.”

Lesson 2 – Quarterly goals are important for planning.

For a publicly traded company, quarterly guidance to stock analysts is a counter-intuitive and dangerous practice for long-term success. Small businesses have to remember that customers don’t buy based on quarterly schedules, so don’t let your quarterly pressure on sales people cost you lost business and, worse, lost relationships.

I learned later that even though my acquaintance was the top loan producer, he was the last one hired, and also the first to go. Now he’s no longer a payroll drain on this bank, but he is now kicking the backside of his former employer as a high-producer with a competitor.

Lesson 3 – In the 21st century, seniority doesn’t trump productivity.

Today, this bank is one of those that had to be bailed out by the government. The bank CEO, who allowed blind devotion to stock price undermine the tried-and-true management practices of building a strong team and taking care of customers, is now no longer a drag on that bank’s payroll.

How much business did this bank lose because of that phone answering strategy? What would have happened if this bank CEO had simply installed an answering system that made sure anyone who wanted to call a local branch could not only find that number easily, but quickly connect to a local person? The answer might be that the CEO would still have his job, and so would my friend and several hundred other former employees. Who knows? By simply adopting a customer-friendly phone system, this bank might have actually needed to hire more employees to handle all of the new business.

Lesson 4 – If you need more sales revenue, make sure your organization’s people, systems, and policies aren’t getting in the way

Recently, on my small business radio program The Small Business Advocate Show I talked about the potential dangers of quarterly policies with sales management expert and Brain Trust member, Skip Miller (m3learning.com), author of The Ultimate Sales Tool Kit. Take a few minutes to listen to what this smart guy has to say and be sure to leave your smart thoughts.

Posted in: Age of the Customer, Customer Care, Storytelling , Tagged: age of the customer, business plan, business planning, business success, customer care, Jim Blasingame, small business, small business success, story, storytelling

The Blasingame Small Business Banking Rule of Thumb

June 17, 2014 10:00 am , admin

For many years, I’ve made recommendations to small businesses with regard to their banking relationships called: The Blasingame Small Business Banking Rules-of-Thumb:

Photo courtesy of Notes From A Chair Blog

1st Blasingame Small Business Banking Rule-of-Thumb
A small business should have at least two banking relationships. If you’re turned down for a loan at one bank, you have another place to go where the person already knows about you and your business. One primary reason for this rule is because if only one banker knows you and your story, when he or she gets fired, promoted or otherwise leaves the bank, Murphy’s Law will dictate that it will happen when you most need a favorable banker.

2nd Blasingame Small Business Banking Rule-of-Thumb
At least one of the banking relationships should be with an independent community bank – that means locally owned and managed – and preferably your lead bank. I’m not picking on big banks, it’s just that most small businesses need to be given a little extra consideration for their character and past performance, which is typically not as forthcoming in a large bank.

Loan decisions made by large banks have two elements that may not give a small business this extra consideration:

1) The actual decision is made by a loan committee in another city, by people who probably don’t know the business owners

2) They rely heavily on what is called “credit scoring,” which is a computer program – each bank has its own proprietary model – that receives quantifiable information and produces a numerical “score”. If this week the bank has decided only scores of 18 or more are accepted, a loan request under 18 will likely be rejected. I’ve never heard of a credit scoring system that includes a variable for the applicant’s character.

Over the years, my Rules-of-Thumb have proven to be valuable to many small businesses. But since 2008, with all of the problems associated with big banks, those who have followed my advice were much less likely to find themselves without access to credit. This was because every independent community banker I spoke had emphatically said they had never stopped lending to their small business customers.

Recently, I talked with two presidents of independent community banks about working with small businesses and the health of the banking industry. First, Mike Menzies, who is not only the president of the Easton Bank and Trustin Easton Maryland, but he’s also the new Chairman of the Independent Community Bankers Association (ICBA). Mike’s also a long-time member of my Brain Trust. Secondly, there is Charles Antonucci, President of Park Avenue Bank in mid-town Manhattan.

They agreed with my advice.

Posted in: Age of the Customer, Banking, Entrepreneurship , Tagged: age of the customer, banking, business, capital, entrepreneur, entrepreneurship, investment, Jim Blasingame, rule of thumb, small business, small business banking

Serving customers online is not an option, it’s imperative

June 12, 2014 10:00 am , admin

In this new Age of the Customer, accessibility to a business through online content is nonnegotiable.

Four years ago, we asked this question about e-commerce: How much of your small business’ annual revenue comes from online sales?

· Five percent said all revenue came from e-commerce.

· Fourteen percent said more than half of their sales came from the Internet.

· A little more than fifty percent said e-commerce represented less than 50% of total sales.

· Twenty-five percent said they had no online sales at all.

E-commerce has been around for a big chunk of the commercial Internet age, which began in 1995 when unencumbered access to the Internet was fully allowed. In terms of historical marketplace practices, e-commerce is just a baby. So I’m actually quite pleased with the mix of responses we received as it indicates 75% of small businesses are generating some e-commerce revenue.

But over the next five years, there will be significant increased pressure to generate online sales.

According to the research firm Forrester, online sales will reach $248.7 billion in the next five years, accounting for 8 percent of total U.S. retail sales by 2014. But the next statistic may be more important (read: ominous) for small businesses.

Forrester also predicts that by 2014, over half of all retail sales will be influenced by online product and company research before customers make a purchase. The reason this stat is so significant is because of another piece of research that produced this astonishing number: Half of small businesses DO NOT have a website.

Regardless of size or industry, no business can expect to be successful in the future without a web presence. Even if you don’t sell online, you MUST be available online so prospects can find you the way people are looking today. Here are two words that make having a website even more of an imperative: local search.

Local search is increasingly replacing the phone book or dialing 411. Even when customers don’t expect a business to have e-commerce capability, like a restaurant or dry cleaners, they do expect to be able to find you online, with product offerings, directions and a clickable phone number.

If you don’t have a website, get one; today you can actually get a simple one for free. And unless you sell nuclear products or Stinger missiles, please, find a way to offer e-commerce to your customers; It’s not free, but it’s no longer cost-prohibitive.

Serving customers online is not an option, it’s an imperative.

Posted in: Age of the Customer, Moment of Relevance, Online Content , Tagged: age of the customer, business, Jim Blasingame, online content, online marketing, small business, web presence, websites

The customer is now in control of your business — get over it!

June 11, 2014 10:00 am , admin

The business world is changing. The Age of the Seller is succumbing to the Age of the Customer, and in this new Age, control of the relationship between Seller and Customer has shifted to the customer as well.

This paradigm shift is largely caused by online platforms that are:

1) increasing the access customers have to information about a Seller and its products

2) allowing customers to express and share what they have learned about and experienced with a business.

Photo courtesy of ThoughtBlender

To put two fine points on the first element of the shift, in the new Age:

First, Customers have access to virtually all the information they need before you know they’re interested, and prospects are similarly informed before you even know they exist. Such access to information is changing – or disrupting – the way you market to and connect with customers, as well as how you train sales people. Plus it demonstrates why your greatest danger in the Age of the Customer isn’t being uncompetitive, it’s becoming irrelevant.

Second, the new kid on the block corresponds to a centuries-old marketplace maxim, “If you make customers happy they will tell someone; if you make them unhappy they will tell 10 people,” which describes the ancient practice of word-of-mouth. The theory behind the 1:10 ratio is that all businesses, regardless of size, are motivated to perform, or risk a marketplace indictment by the judge and jury of word-of-mouth.

In the new Age, online platforms have caused word-of-mouth to transmogrify into a powerful dynamic called “user generated content,” aka UGC. This is when customers post online their experiences, questions, praise or condemnation about a seller’s products, services, and general behavior in the marketplace. In the vernacular, it’s word-of-mouth on steroids.

Indeed, if the word-of-mouth maxim were coined today it would sound like this: “Customers may post online their opinion – positive or otherwise – about your business, making it available potentially to millions.” To paraphrase Mark Twain, comparing word-of-mouth to UGC is like comparing a lightning bug to lightning.

In the new Age you have to do two new things: 1) anticipate that customers are already well informed; 2) track and respond to UGC about your business. And how well you do these two will influence whether the new customer control becomes a sales lever, or a disruptor that makes you irrelevant.

It’s the Age of the Customer — get over it.

Posted in: Age of the Customer, Customer Care , Tagged: age of the customer, business, customer, customer care, Jim Blasingame, small business, small lousiness support

Allow customers to see your authentic side through writing

June 10, 2014 10:00 am , admin

Adam Smith, the father of modern economics and author of The Wealth of Nations (1776), identified writing as one of the three most important inventions of mankind – the other two being money and economic tables.

Photo courtesy of Small Biz Trends

More than two centuries later, the Internet has powered the written word to levels unimagined only a generation ago, let alone during Smith’s era. It is the driving force behind a handy new-media maxim, “Content is King.”

In an era when content is king, if you want to connect with customers competitively and stay connected, you have to produce more written words than ever before. But not just any words – authentic words.

After all, today we’re consumers of many kinds of online content. From streaming audio and video to multi-media formats on iTunes and YouTube. In the midst of all it, the most popular content — hence the Kingly content — still remains most popular in its graphic form, like what Smith would have used.

Since 1999 – long before blogs and social media – two things I’ve encouraged small business owners to do is:

develop better writing skills
publish more of their own words online that communicate to and connect with customers.

Since 2010, prospects and customers want to read about the stuff you sell before they meet you. But they want more than marketing messaging; they want authentic, straight-from-the-horse’s-mouth information that delivers three things that are increasingly a big deal to customers:

1. the voice,

2. the vision, and

3. the values of the human beings behind the stuff, as unartful and unscripted as they may be.

So don’t worry if you’re not a professional wordsmith. When you need fancy words for strategic marketing messaging, online or otherwise, hire a pro.

But you must become comfortable with conveying your vision and values online, in your own words – the voice – about a variety of issues from explaining how to use a product you sell to a local cause you care about to your philosophy on serving customers. And it’s just fine if some of these authentic words also come from your employees who customers will get to know.

In the Age of the Customer®, now armed with as much information as the businesses they patronize, customers expect to be treated more like insiders. And the good news is that no one makes this connection as effectively and authentically as a small business. Congratulations.

Let customers read about your authentic side with your voice, vision, and values.

Posted in: Age of the Customer, Customer Care, Online Content, Storytelling , Tagged: age of the customer, business, Jim Blasingame, online content, small business, small business advice, storytelling, writing, writing skills

In the New Age the Force is with the Customer

June 5, 2014 2:54 pm , admin

—Earth, Stardate 8507 (The Age of the Seller)

Once upon a time, in a galaxy that today must seem far, far away, sellers controlled all information about their products, services and innovations. Consequently, customers learned what they needed to know from salespeople, who traveled far and wide dispensing information to, and collecting sales from, grateful and beholden customers.

If one had observed such a meeting, the customer would have nodded his head in wonderment as the salesperson revealed the virtual magic that was his product. And in this land, the Force — control and availability of information — was with the seller.

—Earth, Stardate 10912 (The Age of the Customer)

On present-day planet Earth things haven’t changed. Customers still buy from sellers that still provide product information. But observing a customer and salesperson today you will see the former explaining how much she knows about the business’s products, while the salesperson nods his head in wonderment. In this universe the salesperson is grateful and beholden if the customer will just contacts him before deciding from whom she will buy.

In The Age of the Customer, the Force—access to lots of information—is with the customer. It began with the remote control, video recorders, TiVo, DVR, Internet, on-demand everything, social media, and more recently, mobile computing. All of the platforms that make up what we now call social media have become the Light Saber of consumers and business customers in the new Age.

Armed with an abundance of online content, commenting platforms, and social media communities, customers not only have access to the information they need to make a better decision, but also co-own brand messages in the sub-space chatter about any given seller or product as it is being evaluated in the online dimension. Alas, too many small businesses are still operating a Stardate 8507 strategy in Stardate 10912. The predominant response by one of these sellers is frustration that they have diminishing control over customer relationships, and therefore their future.

Scotty won’t be able to beam you up if you don’t learn that the only way to end this frustration and assume at least co-ownership of the Force is to embrace online community-building and join the conversations that are being conducted about your business, products, service and industry.

The good news is that this “joining” is not only relatively easy, but also can be done with minimal direct cost. If you don’t know how, ask a 25-year-old customer.

Write this on a rock …

In Stardate 10912, the Force is with the customer.

Posted in: Age of the Customer, Customer Care, Future Thinking , Tagged: age of the customer, age of the seller, business, future thinking, Jim Blasingame, small business, small business growth, small business planning

Blasingame’s Law of Sales Pipelines…for businesses

May 30, 2014 1:00 pm , admin

Selling is a numbers game.

A maxim is a generally accepted truth. Calling is selling a “numbers game” is a maxim for two reasons.

1. There are hundreds – if not thousands – of things that can cause a fully qualified prospect to not complete a transaction, at least not on your preferred schedule.

2. Regardless of all of the bumps on the path to a signed contract, it’s still your job to produce enough sales revenue to stay in business.

Photo courtesy of EOS WorldWide

Enter the sales pipeline, and it’ll all tie together.

A sales pipeline is a planning concept that helps managers and salespeople forecast sales for any given period – week, month, quarter or year. Think of your sales pipeline as overhead plumbing with faucets positioned at the calendar intervals your business requires. From these faucets you draw the mother’s milk of any business – sales revenue.

Pipeline faucets come with screens that only allow a sale to pass through so into the pipeline you load only those prospects you have qualified. That means the prospects that have answered enough questions to allow you to determine that what they want, and your ability to deliver, will combine to produce a faucet-conforming sale within the timeframe or your forecast. Once in the pipeline, a prospect is either on track to become a sale or a forecasting mistake to be removed.

As you record a prospect’s entry into the pipeline you must include what you know about their stage of decision-making, plus what you have to do to move them to customer status. Identifying what’s left to be done with each prospect – demo, trial, proposal, final close, etc. – will help you forecast which faucet –you can expect a sale to pour out of, whether next week or next month.

At this point, let’s refer to The Bard. In Act I, Scene III, of Hamlet, Polonius famously says, “This above all, to thine own self be true.” If you aren’t honest about a prospect’s progress to faucet-conformity, you’re setting yourself up for forecasting failure.

How much revenue you draw from your sales pipeline depends on the twin standards of sales success: quantity and quality.

Here’s Blasingame’s Law of Sales Pipelines: Load the pipeline with enough prospects on Monday (quantity) to have enough qualified prospects to close on Wednesday (quality) so that you can draw the sales you need from your pipeline on Friday (success).

Forecast sales successfully with quantity, quality and to thine own self be true.

Posted in: Age of the Customer, Storytelling , Tagged: age of the customer, business, customers, Jim Blasingame, selling, small business, small business advice, small business success

Businesses should plan for success while operating for survival

May 29, 2014 1:00 pm , admin

Blasingame’s 2nd Law of Small Business states: It’s redundant to say “under-capitalized small business.”

Growing small businesses operate in the narrow danger zone between the leading edge and the bleeding edge of the marketplace, and since our capital reserves and options are limited, every small business CEO makes decisions every day that are at once as much about survival as success.

Operate for Survival
Here are four “operate for survival” objectives to do that will serve you well this year, followed by four “plan for success” ideas.

1. Cash used to be King, today it’s the Emperor. Ask employees to find and cut waste. Get them involved in reviewing operational processes and eliminate or tighten up inefficient ones. What’s their motivation? How about job security? Watch the pennies and the dollars will take care of themselves.

2. Stay close to accounts receivables and cash management. Many tasks can and should be delegated, but in a small business, whether you’re growing or just holding on, cash management is not one of them.

3. Declare war on excess inventory. Inventory is cash you can’t spend until a customer pays for it. Practice Just-In-Time (JIT) inventory management, not just-in-case.

4. Stay close to customers. This isn’t complicated: Ask customers what they want and then give it to them. We’re in the Age of the Customer – know your customers’ expectations.

Plan for Success
Since opportunities will present themselves over the next year, here are four “plan for success” thoughts to consider as you take risks:

1. Eyes wide open. The marketplace we’re entering is going to look different than last year. That means opportunities – and threats – will look different, too.

2. Measure twice, cut once. Before taking a big growth step, apply the carpenter’s rule. Don’t scrimp on due diligence: check your assumptions, recheck your assumptions and then proceed with the best information you have, which might tell you to stop.

3. Mistakes are expensive. Can your capital picture support inevitable mistakes and/or surprises? Remember, there is a very fine line separating opportunity at the leading edge and the cash-eating bleeding edge.

4. Make your banker your partner. Keep him or her informed whether the news is good or bad – especially the bad. Remember this: An uninformed banker is a scared banker and no one ever got any help out of a scared banker.

Successful small business CEOs operate for survival while planning for success.

Posted in: Age of the Customer, Customer Care, Future Thinking , Tagged: age of the customer, business planning, business strategy, customer expectations, Jim Blasingame, small business strategy, small business success

Create online customer communities for your small business

May 22, 2014 1:00 pm , admin

A “craze” is something that takes popular culture by storm. A “fad” is a craze that doesn’t last. Social media is currently a craze, but it’s not a fad. And the question is not whether this craze will last, but rather, what will it look like over time and why should a small business care? Consequently, let’s establish a few “social media” points.

Strictly speaking, “social media” is the technology that makes online community building possible, not the community itself. It allows for the creation of and service to online communities, where dialogue and interaction among community founders and members are possible. Ultimately, the term “social media” in a business application should become the more accurate term, “online customer communities.”

Photo courtesy of MySocialAgency.com

In defining community, Webster uses words like association, fellowship, like-mindedness and shared interests. When building online customer communities, we should remember these words. Every small business should create online customer communities, of which there are two primary examples:

1. A company’s profile pages on sites like Facebook, Twitter, etc. Your company leverages these companies’ platforms. These sites are free but have limited flexibility.

2. Communities founded and hosted by your company, oriented around relationships with customers and prospects. An online community is established when customers subscribe to one or more of your channel offerings in order to receive your information.

A channel is a syndication tool or method of content delivery and service to a community. For example, real simple syndication (RSS), a blog, an email newsletter (ezine), a text blast and Twitter are channel tool examples, through which businesses and their communities exchange information.

Merely having a website isn’t practicing community building any more than owning a piano makes you a musician. But a website can become a platform from which you launch and serve online communities.

There is one critically important thing for a founding company to understand about both of the online customer community types: the company cannot control community behavior. Members – customers and prospects – control the community. A founding company can only create the community and influence it by establishing community values, then serving it via the channels and information it offers, which are requested by members.

Always remember: Customers control online communities, not companies.